Friday, May 27, 2016

The bogus businessman

by digby

Krugman has a good column today about the alleged business acumen of Donald Trump which seems to have convinced more Americans that he would be better for the economy than Clinton or Sanders. Krugman points out that Republicans inexplicably always fare better in polling on this issue despite the fact that the constantly crash the economy and leave a gigantic mess for Democrats to clean up.

But Trump should be vulnerable on this because of ... so many things, not the least of which is the media's inability to inform the public about his inane policy proposals. Krugman examines the "businessmen are gods" concept:

The answer, I suspect, is that voters see Mr. Trump as a hugely successful businessman, and they believe that business success translates into economic expertise. They are, however, probably wrong about the first, and definitely wrong about the second: Even genuinely brilliant businesspeople are often clueless about economic policy.

An aside: In part this is surely a partisan thing. Over the years, polls have generally, although not universally, shown Republicans trusted over Democrats to manage the economy, even though the economy has consistently performed better under Democratic presidents. But Republicans are much better at promoting legends — for example, by constantly hyping economic and jobs growth under Ronald Reagan, even though the Reagan record was easily surpassed under Bill Clinton.

Back to Mr. Trump: One of the many peculiar things about his run for the White House is that it rests heavily on his claims of being a masterful businessman, yet it’s far from clear how good he really is at the “art of the deal.” Independent estimates suggest that he’s much less wealthy than he says he is, and probably has much lower income than he claims to have, too. But since he has broken with all precedents by refusing to release his tax returns, it’s impossible to resolve such disputes. (And maybe that’s why he won’t release those returns.)

Remember, too, that Mr. Trump is a clear case of someone born on third base who imagines that he hit a triple: He inherited a fortune, and it’s far from clear that he has expanded that fortune any more than he would have if he had simply parked the money in an index fund.

But leave questions about whether Mr. Trump is the business genius he claims to be on one side. Does business success carry with it the knowledge and instincts needed to make good economic policy? No, it doesn’t.

True, the historical record isn’t much of a guide, since only one modern president had a previous successful career in business. And maybe Herbert Hoover was an outlier.

But while we haven’t had many business leaders in the White House, we do know what kind of advice prominent businessmen give on economic policy. And it’s often startlingly bad, for two reasons. One is that wealthy, powerful people sometimes don’t know what they don’t know — and who’s going to tell them? The other is that a country is nothing like a corporation, and running a national economy is nothing like running a business.

This is a perennial problem with people consistently saying that the country should be run like a corporation or that its budget is somehow like the family budget. And members of both parties make the mistake of leading people to believe it.

Anyway, Krugman goes on to cite one of Trump's most egregious slip-ups and walk-backs --- the fact that he really believes that workers need to cut their wages to "compete".(Of course he does.)That's what "businessmen" always want to do to help boost their profits. But presidents don't have profits.

Not that Trump knows this. He doesn't seem to have a working knowledge of what the president actually does. He seems to think it's main duties are ordering torture and personally negotiating trade deals. But the people who worship him believe that he'll "make money for America" which will somehow benefit them and that's all that matters. It's a dangerous delusion.